Ticket to ride: CAT gives green light to proposed Rail Fares collective action

20/10/21

The Competition Appeal Tribunal (Roth J, Simon Holmes and Prof Robin Mason) have granted an application for a collective proceedings order (a “CPO”) against three train operating companies (“TOCs”).

The Proposed Class Representative (“PCR”), Justin Gutmann, argues that the TOCs did not do enough to make Boundary Fares available to customers travelling out of London.  Boundary Fares are a type of rail fare for travel on the rail network, which are available to customers who hold TfL Travelcards.  They enable the customer to purchase a rail ticket “starting” or “ending” at the outermost station at which their Travelcard is valid. 

The PCR’s argument is that, because Boundary Fares can be cheaper than a ticket covering the full rail journey, the TOCs abused their dominant positions by failing to do enough to ensure that eligible customers purchased Boundary Fares.  The proposed claim is pursued on an “opt-out” basis, meaning that a class member’s claim would be included unless they had expressly declined to participate.

The claim is denied by all three TOCs, which resisted the granting of a CPO.  The TOCs’ arguments included a contention that the abuse allegations had no realistic prospect of success as a matter of law, and also an argument that the proposed claim did not meet the commonality or suitability requirements for collective proceedings.

The CAT rejected those arguments, finding that the case on abuse is “reasonably arguable” (para 75).  On commonality, the CAT ruled that there was a realistic and plausible method of estimating aggregate damages (i.e. the total amount of loss suffered by the proposed class as a whole) (para 164).  The CAT’s view was that this approach overcame the issues of causation raised by the TOCs – i.e. the fact that not all class members would have purchased a Boundary Fare in the counterfactual (para 138).  The CAT relied in particular (at para 110) on Lords Sales and Leggatt’s dissenting judgment in Merricks v Mastercard, to the effect that an award of aggregate damages could dispense with the need to prove liability to each class member. 

The CAT concluded that a cost-benefit analysis came out slight against the grant of a CPO (para 178), because of the substantial cost of the proceedings, the return to the funder and the risk of low uptake by class members.  The CAT nonetheless considered that the claim was overall suitable for collective proceedings (para 181).

The judgment is here.